In this post I will highlight typical challenges in implementing a short term cash forecasting system and discuss the options we provide as part of our product suite to address cash forecasting needs.
Most potential customers and customers that I have talked to understand the importance of cash forecasting and have some form of cash forecasting capability- they have some systems that contain partial forecast data or could possibly provide partial forecast data. If not systematic, most organizations at least have a spreadsheet or multiple spreadsheets.
Typically, most organizations lack in timeliness and accuracy of their cash forecasts and in decision making capabilities based on consolidated enterprise wide forecast data from say multiple subsidiaries or multiple systems.
We will look at how we could help address timeliness and accuracy of consolidated enterprise wide forecasts systematically via our product suite.
Bulk Upload of Forecasts
If your forecast data is stored in a spreadsheet or can be put into a spreadsheet, we provide you with the ability to upload the spreadsheet into the system. This is the easiest and fastest way to manually upload multiple forecasts from multiple subsidiaries into the system. There are multiple value added feature associated with this as well- such as the forecast dash boards which lets users view the forecasts, edit and delete forecasts as well as roll back complete files that were uploaded into the system. You can reimport rolled back files as well.
Ours being a web based system users with appropriate privileges can upload data or view forecast data across subsidiaries and geographical boundaries.
Automated Import of Forecasts
Automated integration of forecasts from external systems that originate these forecasts via transactions (trades from a Trade Management System, Debt Payments or schedule from a debt management system and EFT origination data from an EFT system are examples) is the best way to ensure timeliness and accuracy of forecasts. Via a standard XML and web services exposed by our system, we have the ability to integrate with any system there is - provided the system we need to integrate with is an open system. i.e. the external system or an intermediate system needs the ability to communicate to a web service.
If you were to choose our Electronic Funds Transfer Module or upcoming Debt Management Module, it is already integrated to the CMO Module for Cash Forecasting purposes. Here again, there are multiple value added features that ensure upto-date information reporting and accuracy such as the creation of a forecast in CMO as soon a transaction is originated and the removal of the forecast from CMO if the transaction in EFT were to be rejected by an approver.
Manual Creation of Forecasts
We provide you the ability to create manual forecasts as well. Users with appropriate privileges can use web based forms, you can create and manage forecasts. This feature is typically useful while forecasting incoming transactions from systems that do not have integration capabilities.
Echo Backs
This feature is typically useful to forecast bulk payments. Say your AP system send a bulk file systematically to a bank with no human intervention. For forecasting purposes, we need to find out the appropriate amount that was sent to the bank with the appropriate value date. Now, there are 2 approaches to getting this data - (1) we could connect to the backend A/P system via the external integration capabilities discussed earlier or (2) we could have the bank tell us what they received- which is essentially the echo back.
An echo back is an automated transmission from the banks that lets our system know the most upto-date information on the bulk payment file. This communication typically contains totals and value dates and is sent by the bank as soon as it receives/processes the file. Our system in turn creates appropriate forecasts for the respective value dates automatically.
The four capabilities discussed above provide the ability for an organization, no matter what their situation is, to forecast enterprise cash accurately in a timely manner. There are multiple value added features in addition to the specific options listed above such as forecasting dashboards, calendar based views, ad hoc reporting capabilities, automated and manual reconciliation of forecasts, ability to capture accounting treatment on forecast creation and integration based on standards, all of which would help your organization forecast better.
Please do let me know if you have any comments or questions @ sujith@treasurysciences.com